Latvia needs to look for ways to reduce costs of Rail Baltica project - Dombrovskis

RIGA - The Latvian government should look for ways to reduce the costs of the Rail Baltica railroad project, the European Commission's Executive Vice President Valdis Dombrovskis (New Unity) said in an interview with Latvian Radio on Thursday.

The estimated costs of Rail Baltica have increased many times over the years, while the amount of funds available from the European Union as part of a specific financial instrument has not increased and will not increase, which means that the government needs to look at how to reduce the costs as not everything could be financed with EU funds, said Dombrovskis.

In his words, part of Rail Baltica should either be financed from the national budget, or more cost-effective solutions should be found.

After 2027, the EU will have a new multiannual budget, and even then the project will have to compete for funding, said Dombrovskis, adding that discussions on the next EU multiannual budget would start next year, followed by a few years of harmonization and approvals.

On the other hand, the issue of the national airline airBaltic, the "write-off of several hundred million euros of debt" before the airline's initial public offering (IPO) and the attraction of an investor are all for the Latvian government to decide, said Dombrovskis.

There had been legal proceedings after state support for airBaltic, Dombrorvskis reminded. At the same time, the Latvian state provided support for its national airline, as many other countries did during the Covid-19 pandemic when airlines were suffering enormous losses.